Sales of digital downloads have not been enough to make up for the decline of CD sales since its peak in 2000. Universal Music Group plans to soften the fall of CD sales by dropping prices across the board, to a maximum of $10.

The company plans to test lower prices beginning next month and continuing throughout 2010. Nearly all of UMG’s CDs will priced between $6 and $10. UMG is hoping that increased volume will make up for the price drop, and the company plans to create more higher-priced “deluxe” versions for more hardcore fans.

“We think [the new pricing program] will really bring new life into the physical format,” Universal Music Group Distribution president and CEO Jim Urie told Billboard.

Retailers have been clamoring for lower retails prices, with many believing that $10 is the magic number to spur sales. (I’ll admit, I rarely buy a physical CD for more than $10 these days). A recent test from Trans World Entertainment showed that a $9.99 price point doubled CD sales in over 100 of its stores.

Forrester analyst Mark Mulligan thinks labels may have to consider pushing prices as low as $5 to further slow the decline of CD sales. “The CD is a dying music product format, but it has some life left in it because downloads haven’t generated the format replacement they were expected to,” he wrote. “With all previous music formats the successor format was firmly in the ascendancy by the time its predecessor was in terminal decline.”

However, digital downloads won’t ever generate format replacement. Music on CDs is already in digital format—if you own the CD already, there’s no benefit in “replacing” it with a digital download. Furthermore, it will be hard to justify spending $10 on a compressed digital download over $6 for an actual physical disc that can be ripped into iTunes or any other media software in a matter of minutes, and can be done using lossless encoding (if so desired).

iTunes LP, thought by the record labels to help save the digital album from succumbing to single track downloads, isn’t making much of a splash with consumers, either.

Effectively, what UMG is doing—and what other labels will do if they also decide that lowering prices will prop up dying CD sales—is giving consumers the expectation that albums should cost even less than $9.99. Because once consumers become accustomed to getting a whole album in physical form for $6, you’ll have a much harder time convincing them to buy downloaded albums for more money later. Lowering prices on CDs will increase sales in the short term—good for labels because CD sales still account for about 65 percent of their revenue—but it will only slow its demise, and slow the uptake of digital as a primary format.

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You think the idea of user-generated content as a business model was invented in the Aughts? No way. Media outlets have been drawing on material created by amateurs, consumers and customers for generations and repackaging it for your entertainment.

Folksy as it may sound, our history is driven not strictly by the polished content produced by a class of citizens with a slew of degrees and many years of training – a surprisingly amount has been generated in a largely unfiltered form by the masses.

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Lon S. Cohen is a freelance writer and social media consultant. He is @obilon on Twitter.

Necessity meant that user-generated content was packaged and presented through very structured channels. That’s not that different from today, where the stuff that we produce is presented through some slick content management system on websites like Blogger or Square Space or through podcatching software like iTunes.

Talk Radio

Click and Clack (Tom and Ray) are two brothers from the very funny and very informative nationally syndicated NPR call-in show, “Car Talk.” Since the 1980s, these guys have done nothing but take calls from real life people who are having trouble with their cars, and then attempt to give good advice and be funny at the same time. It works. While the actual talking is done by these two grease monkeys the fodder is all provided by real people who call in with real automotive woes.

Dear Abby

Think that newspapers are being killed by user-generated content? Well it’s about time we returned the favor since so many advice columnists made a name for themselves using our pitiful problems to advance their fame, dispense advice, sell a few newspapers and make some dough to boot.

One of the most famous and recognizable names in the advice column game was started in 1956 by one Pauline Phillips using the pen name Abigail van Buren or Dear Abby to dispense her “uncommon common sense“. Without the contribution of hundreds of thousands of users over the years, Dear Abby and her twin sister, Eppie Lederer (a.k.a Anne Landers), would never been able to produce such a voluminous supply of folksy advice.

America’s Funniest Home Videos

With the invention of the hand-held Super8 film camera and the video tape recorder, average people could tape themselves doing all sorts of silly, stupid, dangerous, profound or mundane things. Sometime in the late 1980s, television producers saw a goldmine in the stockpile of footage the average American had been recording for more than two decades.

In closest precursor to YouTube that anyone can probably point to, AFV consisted of the serendipitous slapstick of the average American man and beast. From sledding into the side of a house to a cake in the face, American viewers are still not tired of this shows format even though much more of the same can be found on YouTube every day.

Fanzines

Of course, the geeks rule in this very early form of user-generated content. In the 1930s, amateur magazines were produced by science fiction fans as a way to connect with other like-minded people. This became a massive network of people who produced, collected, commented and held conversations about science fiction. Some of the early fanzine publications even consisted entirely of letters sent in by subscribers – a publication with a cool sort of self-generating content paradox!

The preeminent SciFi convention, Worldcon, even instituted a best Best Fan Writer and Best Fan Artist category in the mid fifties to recognize the best of fan made content. Technological innovations like mimeograph and photocopy machines allowed for faster, quicker reproduction of fanzines to a global audience but unfortunately it wasn’t until bulletin board newsgroups and blogging technologies came about until that information could be transmitted faster than the postal system allowed.

Late-Night Television

David Letterman had some wild antics by decidedly non-professional persons and animals with the Stupid Human Tricks and Stupid Pet Tricks segments on his late night show.

Along with fellow comedy writer, Merrill Markoe, Letterman hit on success with these two segments that invited the public to showcase their talents (and the talents of their furry friends) on national television. There were others who followed the David Letterman model of plumbing regular people for content to display on big media outlets.

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The world’s second Internet of Things Conference is scheduled to take place at the end of November in Tokyo. The deadline for papers was just extended to June 1 – which gave us an idea. Conference planners have put together a list of suggested topics for papers. We took that list and then rounded up our ongoing reporting and analysis for each of the eight topics as a way to help you understand how vast and far reaching IoT will end up being.

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‘Green by Internet of Things / Green of Internet of Things Technology’

Our recent list of 6 Ways to Better Living: Inside an Internet of Things Home, looked at the IoT from a domestic standpoint. From handling toxic waste, to watershed management, to building design, to transportation, to the smart energy grid, a whole new green way of thinking is going to be made possible by IoT.

‘Future sustainable technologies linking the physical and virtual world’

Different industries have have already been able to increase the efficiency of freight shipping by using sensors to tell them the location and condition of their product in real-time. This includes FedEx’s SenseAware, which is designed to constantly keep track of the vital signs of all its packages. In future posts we’ll be covering IoT-driven growth in the fields of virtual factories, digital cities, agriculture and forest management.

‘Novel services and applications to facilitate environmental responsibility’

Did you hear about the guy who wired his house up to a Twitter account so that it alerted him whenever an appliance was used? Following that experiment, Matt Morey figured out a way to use iobridge to turn that one-way Twitter alert system into a two-way system that makes it possible to turn appliances on and off via Twitter. These ideas, which may seem novel at first, signal the direction towards the development of whole new industries.

‘Emerging Internet of Things business models and process changes’

Companies as large as IBM have invested heavily in IoT. It has a website called Smarter Planet, which is dedicated to “smarter solutions,” of which they say they’ve already developed 12,00 hundred. We’ve also written about ThingD, which is creating a registry of things, as well as REZZ.IT, which is building a business based on the idea that “things have a network and their own audience.”

‘Communication systems and network architectures for the IoT’

Pachube is the IotT business that has earned the most coverage and analysis from us. Pachube is a service that stores and shares real-time sensor data from objects, devices, buildings and environments. MQTT, which stands for Message Queuing Telemetry Transport, is also noteworthy. It is “a platform-agnostic system which can connect almost any networked object to the wider world.” More recently, Google launched an API for PowerMeter, which allows device manufacturers to create PowerMeter-compatible devices. Also worth mention is our article on Arrayent that aims to be the “Cisco of small things” – which is basically middleware for companies wanting to connect their products to the Internet. In particular it’s targeting smartphones.

‘Experience reports from the introduction and operation of networked things in areas such as healthcare, logistics & transport’

IoT is still so new that we have only just begun to see the results of research. But with RFID, for example (which is one of the more mature IoT technologies), we’ve reported on how there have been enough challenges to limit predicted growth. There also a range of user experiences related to IofT location-based services.

‘Emerging applications and interaction paradigms for everyday citizens’

From preventing lost luggage, to the latest IoT gadgets, telling the story of what a person’s everyday daily life is an integral part of IoT. Most notable is the presentation by Carnegie Mellon professor and ex-imagineer Jesse Schell, who describes how sensors in everything may one day mean the sensor in your toothbrush gives you online gaming points if you brush for the full three minutes. He also envisions sensors that track if you are watching TV commercials and again rewards you with online gaming points. Core to Schell’s ideas is the belief that these incentives may seem a bit creepy, but they have potential to help us create a less corrupted, more accountable and ethical world.

‘Social impacts and consequences: security, privacy, opportunities and risks’

In our What The Internet of Things Means For You series we covered privacy issues related to the use of RFID and barcode readers. The latest reports show how advertisement, RFID and geolocation have combined to raise serious privacy concerns. Additionally, location-based data can be a threat to personal privacy in the context of how the U.S. congress has started to draft location-based privacy protection laws.

Are you going to the Tokyo for Internet of Things Conference? What do you hope to learn there? Let us know in the comments, or by emailing tips@readwriteweb.com, what we should be discussing in the months leading up to the event.

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Sex.com is the most valuable domain name in the world (for obvious reasons). Right now it’s up for sale, and two of the prospective buyers might surprise you: People for the Ethical Treatment of Animals (PETA) and a California meat company called BullWhip.

PETA published a letter requesting that Sex.com’s owners donate the domain name (valued at $18 million) so the organization can use it as a tool in its recent “vegetarians are sexy” ad campaign. PETA described a website where visitors could watch sexy ads, vote on the sexiest vegatarians (they include the above-pictured Alicia Silverstone as well as Pamela Anderson), and find out which veggies are aphrodesiacs.

In response, a BullWhip executive named Dick James sent out a press release praising meat-based diets and describing his plans for Sex.com. His lack of seriousness became clear when he got into that second point. He said, “Our plans are to have celebrities such as Angelina Jolie eating a hot dog or Eliza Dushku with two big slabs of Angus steak on her breasts. Britney Spears and Paris Hilton have also been contacted to fight in a tub of hamburger.”

Clearly he’s just mocking PETA, so comical as all this is, it’s just a PR stunt on the parts of both companies. PETA knows the owners of Sex.com are unlikely to donate the domain, and BullWhip is unlikely to make a serious offer. It’s as entertaining a PR fight as you’ll see, though.

We’ll leave you with the rejected, sexy PETA Super Bowl ad. It’s probably not quite safe-for-work.

Tags: animal rights, bullwhip, Domain Names, domains, peta, porn, pornography, sex, sex.com

Universal Music Group will drop the prices on the majority of its new CD releases to between six and 10 dollars. This plan — dubbed the Velocity program — will go into effect in the second quarter of this year.

UMG hopes this plan will at least slow the serious decline in CD sales that has been going on since MP3s and other digital music downloads came on the scene.

While UMG has its hands in music downloads and streaming, too, the profit margins are usually better with CDs. UMG claims that its cheaper CD plan will maintain a 25% profit margin.

Up until now, most new CDs have actually been more expensive than their download counterparts. If the price comes down, consumers will be more likely to purchase the goods. It’s a simple economic principle. But to try to incentivize music fans even further, UMG plans to load the jewel cases with “deluxe” content that you won’t usually get with online purchases.

We’re not going to complain about lower prices. We welcome anything that reduces consumers’ expenses. But do you think this will actually make a difference? A couple of us in the Mashable office haven’t bought a CD in years — if you’re the same, will UMG’s plan turn you around?

Will you buy “deluxe” CDs for under $10?polls

[img credit: lrargarich]

Tags: CD, CDs, digital downloads, music, umg, universal music group

Microsoft’s a pretty big company, and while we’ve been focused on its Windows Phone 7 Series and Pink mobile projects over here in the Land of the Free, its Live Messenger arm has apparently teamed up with French mobile carrier SFR for a branded phone. The Messenger Edition 251 handset looks to be based on Windows Mobile 6.5 (or something older), with no word on who the hardware partner is, and is taking on the youth market just like Pink will presumably be doing Stateside sometime this year. Of course, Messenger is much more popular in Europe than it is in the States, so it makes sense to brand a phone around it, but underneath that candy QWERTY shell we’re sure those hapless Europeans can find plenty of legacy Windows Mobile to be desperately disappointed in.

[Thanks, Bibo]

Microsoft’s Windows Live Messenger phone for France is hardly Pink originally appeared on Engadget on Thu, 18 Mar 2010 20:38:00 EST. Please see our terms for use of feeds.

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Nokia’s community blog has opened up the crowdsourcing floodgates, at least in theory. For “Design by Community,” users will be able to vote on smartphone features via a series of sliders, although within an arbitrary point allotment system. A new poll opens next week for size and shape, followed by materials, operating system (Symbian or MeeGo being the only choices, unsurprisingly), and so on in the weeks that follow, with the last poll starting April 26th. After that, a concept sketch will be voted on and later rendered — but no plans to ever have it made into an actual retail product (boo). We can’t exactly say we understand all the selections here: why is a touchscreen keyboard less ambitious than T9 text entry? Does saying capacitive is more ambitious than resistive serve as a subtle hint of trends to come? What in the world is the difference between hot key and one touch? It’s interesting to see how X6, N900, N97 all come out as a Perfect Mixes, while last year’s E75 and the more recent C5 all straddle the “less than ambitious” line. Oh, and just so we’re clear… a 5-inch, 21:9 ratio display without touchscreen but with a touchscreen keyboard is a perfect mix. Go figure.

[Thanks, Pratik V]

Nokia’s Design by Community makes smartphone concepting a multiplayer game, with limits originally appeared on Engadget on Thu, 18 Mar 2010 19:49:00 EST. Please see our terms for use of feeds.

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Google is looking to take the Android operating system to the big screen—the one in your living room, anyway. The company has partnered with Intel and Sony in order to bring a more interactive viewing experience to the TV in the form of (you guessed it) set-top boxes. The idea behind it is giving users the ability to seamlessly switch between Web apps and video entertainment, though there’s already plenty of competition in this space. Or is there?

According to the New York Times, Google plans to treat this platform in the same way it treats Android for Mobile—it will open the platform to developers “within the next couple of months” and products could hit the shelves sometime this summer. That means third-party apps could show up on TV just as easily as they do on our mobile phones, from Twitter apps to games to Wikipedia browsing and more. It also means, however, that there’s potential for an overflow of apps to be available (hello iPhone App Store).

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Amazon’s Kindle software for Mac has finally arrived, a hair over six months after its Windows counterpart. The free application allows Mac users to read books from the Kindle Store on their desktops and sync their items across other devices, including actual Kindles, iPhones, BlackBerrys, or Windows machines using the Kindle software. Since we gave the PC version a (semi-successful) run through, we thought we would take a look at Kindle for Mac as well.

Once you download the software and log in with your Amazon account, the Kindle software presents you with an essentially blank “Home” screen and an “Archived Items” tab. If you have already downloaded books to read on other devices (I’m an active Kindle 2 user, for example, so I have plenty of books already), then the Archived Items tab should be filled with everything you have ever bought.

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More often than not, an entrepreneur with a great idea looking for funding will pitch his or her startup dozens, if not hundreds of times to potential investors. There is an endless amount of resources out there for entrepreneurs looking to learn the best practices for their pitch, including what to include in their decks, how long to speak, and what pitfalls to avoid. By the time an entrepreneur actually gets funding, they’ve probably mastered their pitch to a point where they could recite it in their sleep and provide advice of their own to newcomers. The problem with this is they can get stuck in their pitch mentality and it can creep into areas of their business that need the ole straight talk express.

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Michael Hirshland of Polaris Venture Partners, who blogs under the name VCMike, wrote today about a problem he often sees when in board meetings with startups. The issue is that entrepreneurs are so used to speaking a certain way to VCs that they sometimes have a pitch-like tone that gets in the way of board room progress. As Hirshland points out, don’t try to beat around the bush when it comes to bad news.

“VCs hear bad news all the time — it is part of the startup process and part of the VC job description,” says Hirshland. “Any VC worth his or her salt should respond to bad news, provided it is shared in a timely fashion, by helping the entrepreneur figure out the best way to respond rather than dwelling on what went wrong.”

He advises CEOs to stear clear of attempts to placate their board members by spouting off excuses for whatever their bad news is, or by claiming that they are already fixing the problem in hopes of avoiding any impending wrath. From what Hirshland says, board members are not schoolmasters there to punish you and whip you into shape; they are there to help, so don’t isolate yourself, he says. If you speak openly and honestly about your issues with your board, chances are you will preserve your most valued asset as an entrepreneur and as a startup: credibility.

“Early stage ventures are filled with ambiguity. Entrepreneurs and their investors need to make quick decisions based on information that is far from complete,” says Hirshland. “This necessitates relying to a very substantial degree on the entrepreneurs’ interpretation of the situation and prospects.”

In other words, you are the eyes and ears for your board, and if you aren’t being open and honest with them, bad things will happen. Worst of all, speaking with fluff and rounding out the rough edges of your company will destroy your credibility, which Hirshland calls “toxic” to your partnership and “not a happy place for either the entrepreneur or the investor.”

As we mentioned earlier this week, credibility is your best friend when trying to get funded, so make sure you carry it with you and preserve it in your board meetings and into your company’s future. Save the pitching for future rounds of fundraising, and when it comes to your board members, don’t try to win them over, simply treat them like equal members of your team.

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